Cover Story

Location, Location, Location

01.01.12 by Charlotte Huff

Rural hospitals win over physicians with an array of incentives and board support.

Rural doctors enjoy some daily benefits, among them fresher air, low crime rates and the chance to raise children who can count a blanket of stars in the night sky. A paycheck also may stretch further than in urban-based practices, enabling a down payment on one of the area's most elegant houses and the opportunity to build a practice and reputation as a pillar of the community.

But signing on that dotted contractual line also can entail some professional and personal risks. A physician's spouse might struggle to land a nearby job. It might require a road trip to find flute lessons or the convenience of big box shopping. Building a rural practice also can mean limited call coverage, too many sleepless nights and the ever-nagging sense — depending on the specialty involved — that colleague backup in the face of complex treatment decisions is limited to nil.

Even those who enjoy the challenges and variety, like Burke Hansen, M.D., readily acknowledge that it's difficult to turn the job off. "I simply can't go to the grocery store without running into patients who say, 'You know, I need a refill on my blood pressure medication,'" the Dillon, Mont., family practitioner says.

These perennial recruiting challenges have eroded access to care in many rural communities. Roughly three-fourths of the 2,050 rural counties in the United States include a primary care health professional shortage area, according to a 2011 policy brief by the Washington-Wyoming-Alaska-Montana-Idaho Rural Health Research Center. Nearly one in 10 rural counties has no primary care physician.

But these near-chronic shortages may worsen in the years ahead, according to rural hospital administrators and recruiting experts. They point to the nation's aging population and the projected U.S. physician shortage, most notably among the primary care doctors who comprise the backbone of rural care. Meanwhile, hospital administrators nervously anticipate the retirement of their older doctors, the ones who seemingly never slept, aware that younger physicians coming out of school are less likely to make that lifestyle compromise.

"My one independent doctor is looking at trying to slow down a bit," says Cherie Taylor, chief executive officer at Northern Rockies Medical Center, a 20-bed nonprofit hospital in Cut Bank, Mont. "So I'm recruiting for two family practitioners, because it will probably take two to replace him."

In their effort to court physicians, hospital leaders describe various strategies, such as tapping programs to assist with loan forgiveness, among other financial carrots. Some have set up training rotations with medical schools to expose students early on who might not otherwise have contemplated rural practice. The Affordable Care Act also includes some promising training provisions that could benefit rural facilities, says John Supplitt, senior director of the American Hospital Association's Section for Small or Rural Hospitals. "But the wild card," he says, is funding, including "how much will be sustained if there are cutbacks to the ACA."

Supply vs. Demand

Physicians wrapping up their residencies are more interested in hospital employment than ever, according to a Merritt Hawkins survey of 302 final-year residents conducted last fall. One-third of residents said they'd be most interested in becoming a hospital employee, compared with 4 percent in 2003. Jim Platt, CEO of 50-bed Fort Madison (Iowa) Community Hospital, a nonprofit facility, notes a dramatic shift, particularly in the last five years. "We don't talk to anybody who doesn't want to be employed," he says. "They all do."

The old real estate mantra still applies: location, location, location. Geography ranked among their most important considerations for 81 percent of the residents compared with 57 percent in 2008. Nearly half, 48 percent, were most interested in practicing in a community with at least 500,000 people. Just 6 percent preferred one with 50,000 or fewer.

And for rural hospitals, the cost of landing that new physician can be daunting. A paycheck will stretch further in a small community, but that doesn't mean the physician will accept a reduced offer, says Mike Farrell, CEO at Somerset (Pa.) Hospital, a 150-bed nonprofit hospital located 70 miles from Pittsburgh. "If a physician is able to demand a salary of $500,000 to $600,000 anywhere else in the country, we're going to have to meet that range," he says.

Moreover, the shift to physician employment can complicate matters for a hospital administrator, says Mary LaRowe, CEO at nonprofit St. James Mercy Hospital in Hornell, N.Y. A rural community might need the skills of a particular subspecialist, but lack sufficient patients to support a full-time practice, she says.

"If you don't have the volumes to cover your overhead, you are literally bringing on a physician for the community at a loss to your bottom line," she says. "You really have to pick very carefully those whom you employ and those with whom you might be able to work something out through a contractual arrangement that's not truly employment."

Looking forward, the competition for physician talent likely will escalate, based on projections from the Association of American Medical Colleges. Citing the expanded pool of insured patients under health reform and an aging population, the nonprofit group estimated in 2010 that nearly 92,000 more doctors will be needed by 2020. Half of those projected vacancies will be in primary care.

Rural administrators hoping to fill some of the physician gaps with mid-level practitioners may not get as much help as anticipated, at least in terms of primary care coverage. An analysis of physician assistants, published in Health Affairs in 2010, showed that mid-level practitioners were migrating into subspecialty areas. From 1996 to 2005, the number of PAs in primary care declined from 54 to 41 percent.

Creative Recruiting

Given the competition with their urban counterparts, rural hospital leaders have been forced for years to be innovative in their recruiting strategies, says Travis Singleton, a senior vice president at Merritt Hawkins & Associates, a physician recruiting firm based in Irving, Texas.

A lot of the recruiting lures now considered routine, such as loan forgiveness or scheduling accommodations, were pioneered by rural hospital leaders, as they strived to gain a competitive edge, Singleton says. "Now everyone offers that. In a sense, the playing field has leveled a bit and that's made it very difficult for rural hospitals to keep up," he says.

At Somerset Hospital, Farrell has tried to make his location work to his advantage. The hospital is an easy drive to Pittsburgh and its big city perks and yet serves a region with a designated physician manpower shortage. Thus, Farrell says, "We are an attractive area for J-1 visa holders."

Under the federal program, doctors from other countries who are trained in the United States can remain in this country if they work in a shortage area. The state of Pennsylvania also provides some loan forgiveness for physicians practicing in manpower shortage areas, Farrell says.

He credits the program with enabling his hospital to recruit two vital specialists who started in 2011, one a general surgeon specializing in colorectal surgery and the other an anesthesiologist with a pain management focus. "We would have never gotten those two specialists here had we not been eligible for J-1 visa waivers," he says.

Another route: Hook medical students on rural practice. Doctors who train in rural areas are two to three times more likely to return to practice in a rural community, according to a series of studies, a fact that's not lost on hospital administrators.

In the last several years, Iowa's Fort Madison Community Hospital has begun serving as a training site for students studying at Des Moines University, a graduate health sciences university that offers a degree in osteopathic medicine, among other disciplines. The student rotations are typically a few weeks to a month, says CEO Platt. Last year, the hospital added a one-year training slot.

During the last week of each rotation, Platt and senior leaders at the hospital have breakfast with the student to gain insights into how it went, how it could be improved, and whether the student would like to return for another stint. "And then, what would it take to entice them to come to work for us when they are through with their residency program?" Platt says.

Training Initiatives

Nationally, 15 percent of family residency programs have established a formal rural training track, according to findings published in 2010 by the WWAMI Rural Health Research Center, based on a 2007 survey of 354 residency programs. (The WWAMI center is one of six rural health research centers that receive federal funding to study issues related to rural health care.) Nearly two-thirds of the rural training tracks were tied to rural programs; 10.5 percent of the urban programs had rural tracks.

As required residency rotations increase, it's more challenging for urban programs to carve out curriculum time to get physicians into rural health sites, says Mark Doescher, M.D., who directs the WWAMI Rural Health Research Center. "It's very difficult for the urban programs to find both financial mechanisms and time in the required schedule to allow it to occur."

The health reform law did include some provisions designed to expose more physicians and mid-level providers to rural practice, according to Doescher and the AHA's Supplitt. They include efforts to redistribute some unused residency slots into rural communities, along with the establishment of teaching health center development grants. The grants would assist with establishing or expanding residency programs tied to community-based outpatient centers, such as federally qualified health centers.


But funding of such efforts is clearly vulnerable, Supplitt says. At press time, for example, the 15 members of the new National Health Care Workforce Commission — established through the Affordable Care Act — had been appointed. But the commission hadn't been funded. "They were supposed to be working toward innovative ways to encourage training in key areas — rural primary care is a key area," Supplitt says.

Supplitt remains similarly pessimistic about a recent legislative push, supported by the AAMC, to boost the number of Medicare-supported residency training slots by 15 percent over a five-year period. Any increase would only benefit rural communities, he says, "if they were targeted to primary care and general surgery, and only if there were incentives for them to train in rural areas."

The Personal Touch

Taylor, CEO of Northern Rockies Medical Center, opted to stop using large recruiting firms after she assumed the chief executive role in 2010, deciding instead to get more directly involved. The money used on recruiting firms, some $50,000 in the prior year, she says, instead will be applied to boost compensation for the two family medicine doctors she wants to hire at roughly $200,000 apiece.

Neither does she mince words about the pluses and minuses of practicing in a community of roughly 3,000 people, located about 30 miles south of the Canadian border. "I'm trying to be blatantly honest to them about Cut Bank because I don't want to waste my money on our side for somebody who's not going to work," Taylor says. "I've actually had people tell me after conversations, 'You know, you're right, this is not the place for us.'"

One of the primary care doctors hired through a recruiting firm, a single guy, didn't stay much longer than a year, Taylor says. Another, also single, didn't show up for the first day of work. "There is not a happening single life here at all — it is great for families," she says.

Once she does identify a promising candidate, Taylor says that she carries a proverbial ace in her hand: the board. The members are very involved in recruiting, including matching the spouses of prospective candidates with someone locally that has a similar interest, whether that's outdoor sports or raising children.

During his or her Cut Bank visit, the physician's itinerary will include a dinner with the board and other key players not at a restaurant, but rather a home-cooked meal hosted at a physician or board member's home, Taylor says. That type of personal contact has some side benefits, among them, she says, "they see that just because you are in a small rural town doesn't mean that you can't have a gorgeous house."

Above all, getting better acquainted with the board members can help ease the nerves of a physician who is looking to make a significant professional and personal leap, Taylor says.

"CEOs come and go," she quips. "But if they have a commitment from a board that's been there for the long term and they see that, they know that they have a constant force that's interested in protecting them in the community and meeting their needs."

Charlotte Huff is a writer in Fort Worth, Texas.


David C. Goodman, M.D., has no doubt that some hospital administrators struggle to recruit orthopedic surgeons, cardiologists and other subspecialists. A hospital might want to expand its roster to elevate a treatment program or to compete more effectively with another facility down the road, says Goodman, who directs the Dartmouth Institute's Center for Health Policy Research.

But a shortage, at least from a hospital administrator's perspective, doesn't necessarily mean that patient care is being shorted. "That's making the assumption that every one of those vacancies serves the population well," he says. "And we know that's not the case."

Last fall, legislation was introduced in Congress that could increase the number of Medicare-supported residency slots by 15 percent over five years, following concerns in some quarters about a looming physician shortage (see graphic). Goodman, though, is not the only researcher who is building the case that adding more doctors — and particularly subspecialists — does not de facto translate to better patient care.

Studies indicate that increasing the pool of primary care doctors can be beneficial, says Kevin Grumbach, M.D., director of the UCSF Center for California Health Workforce Studies. Still, no such correlation has been identified to date with specialists, he says, citing as one example a 2004 Health Affairs analysis that broke down Medicare spending and quality.

In that study, researchers not only found that high-spending states had lower quality of care, but also looked at the mix of the physician workforce. Those states with a higher proportion of primary care doctors had better care. But a greater density of specialists correlated with poorer quality outcomes.

Moreover, training more doctors does not automatically assist rural and other underserved areas, according to another 2004 Health Affairs analysis that Goodman authored.

He tracked sizable increases in per capita physician supply between 1979 and 1999: a 45 percent increase in primary care doctors, 118 percent for medical specialists and 21 percent for surgical specialists. Yet four out of five of those new doctors opted to practice in regions with a high supply of physicians.

Before simply ramping up supply, other redistribution strategies should be pursued first, such as telemedicine outreach into rural communities and using more financial incentives to convince doctors to practice in underserved areas, Grumbach says. "The metaphor I tend to use is: Until we stir the sugar in the cup of tea, don't add more sugar to the cup." — C.H.


Landing a long-sought physician is only half the battle, workforce experts say. The real challenge: convincing that talented doctor to plant deep roots in the community.

To that end, board members can be influential, making sure that the doctor has sufficient backup not only to avoid burnout, but to thrive professionally, says John Supplitt, senior director of the American Hospital Association's Section for Small or Rural Hospitals. "You can't expect the physician to be on call all of the time, whether it's figuratively or literally," he says.

"There has to be an incentive for them to live in a rural area that has certain lifestyle demands and certain isolation. It's not simply more money. You can throw a lot of money at people and then they will leave," he adds.

Create a safety net, whether it's tapping the help of other doctors or mid-level practitioners, so the physician can leave town for more than an occasional vacation, Supplitt says. Physicians also need to attend professional conferences and other educational events. While online interactions are helpful, Supplitt believes there's no substitute for in-person networking.

"They often don't have a peer group," he says. "They need a professional sounding board against whom they can bounce off ideas, so they can learn more and practice better."

Meanwhile, don't ignore the personal side of the equation, says Mark Doescher, M.D., director of the Washington-Wyoming-Alaska-Montana-Idaho Rural Health Research Center.

Today's doctors are increasingly part of two-career professional couples, which means that the spouse will need to find meaningful work nearby, he says. Plus, board members should pay attention to the caliber of other community amenities, such as the schools, as physicians will be vetting them.

"Don't be a passive board member," advises Travis Singleton, a senior vice president at Merritt Hawkins, a physician recruiting firm based in Irving, Texas. "The best way to recruit is to not have to. Reach out to your current physicians. Find out if they are happy, if they are not happy, and what you can do to make their lives better." — C.H.


Health Resources and Services Administration: Identifies health professional shortage areas across the country |

Kaiser Family Foundation: A good resource regarding the time table and implications of the Affordable Care Act |

Rural Assistance Center: Provides guides about rural challenges and opportunities, such as the J-1 visa waiver |

WWAMI Rural Health Research Center: Posts numerous studies and related resources looking at workforce challenges |

comments powered by Disqus